Foreign Relations of the United States, 1961–1963, Volume XVI, Eastern Europe; Cyprus; Greece; Turkey

134. Memorandum of Conversation⁰

SecDel/MC/67

New York, October 4, 1962, 3 p.m.

SECRETARY’S DELEGATION TO THE SEVENTEENTH SESSION OF THE UNITED NATIONS GENERAL ASSEMBLY

New York, September, 1962

SUBJECT

• Relations with Yugoslavia

PARTICIPANTS

• US
  • The Secretary
  • Mr. Richard H. Davis (EUR)
  • Mr. Philip Valdes (SOV)
  • Mr. Peter Thacher (USUN)
• Yugoslavia
  • Mr. Vladimir Popovic, Member of Federal Executive Council,
  • Chairman of Yugoslav Delegation

The Secretary said he would like to talk about our bilateral relations, since these are in a state of what he hoped would be temporary complication. First, he wanted to discuss the trade question. President Kennedy is trying hard to prevent Congress from taking action with respect to the most-favored-nation clause. We still did not know what the final result would be but at no time has there been any question of the view of the Executive Branch. The Secretary said he had met at least eight times with Congressional committees to explain to them the importance of keeping our relations with Yugoslavia on a normal basis. He urged upon Mr. Popovic the importance of neither the Yugoslavs’ nor our reacting too quickly. We on our side should take time to look at what possibilities there are, then we both should sit down and talk over actual trade problems and possibilities. He realized it would not be easy for the Yugoslavs in view of the political atmosphere resulting from Congressional action. He said that on the practical side he was not discouraged about the possibilities.

Secondly, he said he wanted to talk about the EEC aspects. The powers granted to the President under the Trade Bill will let us negotiate vigorously for a common reduction of external tariffs. It is in our interest to do what we can to prevent the EEC from becoming a small, closed trading community rather than a broad, open one. We hope that what Yugoslavia can do by its trade with Western Europe and what we can do because of our Trade Bill will help ensure this. The Secretary said he would like to hear Mr. Popovic’s views.

Mr. Popovic said he wondered what possibilities the Secretary saw in our bilateral trade relations.

The Secretary said we would have to wait to see what flexibility Congress will permit. For example (and this was speculation rather than a promise) the treaty of 1881¹ provides for a one-year advance notice before denunciation, and perhaps we can get a legislative amendment during that period or in the absence of the most-favored-nation treatment we could see what we could agree to bilaterally on specific items under our new trade legislation.

Mr. Popovic said the Yugoslav people and Government very much want good relations between our two countries and this will not change. Nevertheless, the trade question does concern Yugoslavia greatly. He realized the U.S. Government has made efforts with Congress. He would like, however, to suggest additional arguments that might be of use. MFN is a mutual obligation embodied in a bilateral treaty, signed long ago, providing a one-year period for denunciation. Secondly, Congressional action came at a particularly unfavorable moment during the Brezhnev visit. The Secretary interjected that we had already used these arguments. Moreover, Popovic continued, Congressional action would affect Yugoslav relations not only with the U.S. but also with the EEC countries. Next year obligations fall due on loans Yugoslavia has received in order to liberalize its economy. The question will be how to meet these obligations. Generally, one can say there is no doubt that Congressional action will affect our political relations. This is neither in Yugoslav nor U.S. interest. The U.S. press calls Yugoslavia Communist but, at the same time, the U.S. recognizes Yugoslavia as non-aligned. Yugoslavia is very active in this way in a positive manner. For example, Ambassador Klutznick mentioned the Cairo Conference very favorably yesterday. Yugoslavia sees more such possibilities. Mr. Popovic hoped Congress realized this. He suggested there were some things the U.S. Government can do. He has talked to some of his commercial people and they reported that the Americans with whom they deal are now stopping negotiations on the grounds they don’t know what will happen. The U.S. Government might, therefore, make a statement which would help in this respect.

The Secretary said that on the basis of the final Congressional action we will examine the possibilities as quickly as possible. He did not think this would take very long. He said that to some extent our bilateral relations are caught in a crossfire of matters for which Yugoslavia is not responsible and over which Yugoslavia has little control. The Soviet pressures in Berlin are a prime example. We have not been able to assure our people that Khrushchev is willing to settle the Berlin question peacefully. The Berlin question should not make any difference in our relations with a non-aligned country but the fact is it does. Another factor is the unnecessary and inflammatory buildup of military equipment in Cuba. In this atmosphere a non-aligned but Marxist nation comes under criticism. This general atmosphere is not related to the Yugoslav problem but Yugoslavia is caught up in it. The Secretary pointed out there was also a domestic factor. He said that, whereas most of the Polish nationality groups in the U.S. have supported the concept of increased trade with Poland even though they did not favor the existing Polish Government, the Yugoslav nationality groups here generally have not, and have been unhelpful with Congress.

Mr. Popovic said that the Yugoslavs support the U.S. attitude for a peaceful settlement of the Berlin and German question and recognize the efforts the U.S. Government has made to this end. These efforts make it easier for Yugoslavia to use what influence it has with the other side not to take a rigid position; that is, the more the U.S. shows willingness for a peaceful settlement, the more Yugoslavia can do to help. He commented, however, that the Federal Republic shows no willingness to normalize its relations with Yugoslavia and this affects Yugoslav public opinion. As for Cuba, Yugoslavia would, of course, like to see it non-aligned. Yugoslavia is not on very good terms with Cuba. On the other hand, self-determination and non-interference are basic principles in Yugoslav policy and Yugoslavia still thinks there is a possibility for the U.S. to settle the question peacefully. As for the Yugoslav immigrants in the U.S., there are two groups, one of which does support good relations. There is a large Croat organization which does and he thought the Slovenes did too. In fact, the great majority of Yugoslavs here want good relations but perhaps they are not active enough. He was certain that the political immigrants are more active, and sometimes misinform U.S. politicians. Turning to our action with respect to shipping, he said that he thought that technically we could avoid problems as far as the Yugoslavs were concerned. On principle, however, he felt the action was not correct, involving as it did third countries. Yugoslavia ships no military cargo to Cuba. This affects only Russia.

The Secretary said we are not imposing a blockade. As for a settlement, the Cuban problem does not involve ourselves alone but other countries in the Hemisphere as well. There are only two points that are not negotiable. The first is the military and political connection with Moscow. The second is Cuban interference in other countries of the Hemisphere with agents and funds. This is active interference. As to Germany, the Secretary said that he could understand why Yugoslavia might not want to see Germany reunified now. Mr. Popovic interjected that what worried them was re-militarization, not reunification. The Secretary continued that we may not agree with the Yugoslav position but we could understand it. We think, however, that it would be a mistake to close the door to reunification. Nationalism being what it is, the prospect of permanent separation may bring the wrong Germans to the top in both parts of Germany. As for militarization, he said, our memories are short. The Soviets armed the East Germans for one year under repeated Western protests before the Federal Republic started to arm. The all-German problem, however, is separable from the Berlin problem. Our commitments are such, and our agreements with the Soviet Union are such, that we cannot and will not agree to turn over two and a quarter million Berliners to the East Germans. If this fact is understood as a basic point, all other questions can be handled. Khrushchev, however, talks only about West Berlin, saying that East Berlin and East Germany have already been settled and are no longer under discussion.

Mr. Popovic said he thought there were possibilities for solving the Berlin question peacefully. President Tito and he had stressed the need for the Big Two to negotiate. Not only the Russians, but others in the bloc as well, want to settle the question. He did not, however, see any willingness here to make efforts toward a settlement before our elections.

The Secretary said that our elections have nothing to do with it. No U.S. President could give up West Berlin, elections or no elections.

Mr. Popovic said he did not think anyone was asking for that. He was sure the Soviets are not very much interested in the Cuban question now; they are concentrating on settling Berlin.

The Secretary said we are talking in circles with the Soviets on this. First they say they want to bring World War Two to an end. We say all right, let’s discuss how to do this—self-determination, etc. Then they say look at the fact, there are two Germanies. We say there is a third fact—Berlin. They say they want to change that fact, so we are back to the question of putting an end to World War Two. Given this circle, we have tried to convince them that the problem is now to accept the fact of disagreement. How then do we manage this fact of disagreement without war and how do we work out a modus vivendi. Up to now, the Soviets have shown no interest in this.

Mr. Popovic said that if we could agree on (1) demilitarization of Germany and (2) guaranteeing the frontiers, then the Berlin problem would disappear.

The Secretary said we have had some experience with demobilization. Our military budget in 1947 was 10 billion dollars; it is now about 50 billion dollars. The graph of the increase coincides with pressures on Greece, Turkey, Korea, Berlin, etc. If we take ten billion dollars as our normal peacetime military budget, then we have spent, since 1947, 420 billion dollars above normal because of Soviet pressures in addition to the lives lost in Korea. We have seen nothing in our experience since 1945 which gives us any confidence in demilitarization as a solution. He said he did not expect Mr. Popovic to comment on this but he wanted to say that, given the situation in Central Europe, the presence of U.S. forces in Berlin and West Germany is a stabilizing element.

Mr. Popovic said he could agree to this if we made efforts to settle the Berlin question.

The Secretary said he wondered why the Soviets did not destalinize East Germany. If the regime were more accepted by the people there would be fewer tensions.

Mr. Popovic commented that he was not sure. The East Germans do recognize their frontiers, they have negotiated a trade agreement with Yugoslavia and in general the Yugoslavs have found them easy to deal with. He repeated that he thought it was possible to reach a peaceful settlement. The Secretary replied that we do not say it is impossible; he just did not see any possibilities now. He asked Mr. Popovic how long he intended to stay in the U.S. Mr. Popovic replied he would be here about two weeks. The Secretary said that before Mr. Popovic left, we should have something more precise to say about the trade problem. There is some prospect that statements will be made on the floor of Congress which will ease the problem as far as the legislative history and Congressional intent are established.

Mr. Popovic asked if the Government could make a statement.

The Secretary replied he felt sure the President’s efforts with Congressional leaders were more important at this juncture than any statement that could be made. He urged Mr. Popovic not to be prematurely discouraged.

0. Source: Department of State, Conference Files: Lot 65 D 533, CF 2153. Confidential. Drafted by Davis and Valdes and approved in S on October 5. The meeting was held in Secretary Rusk’s suite at the Waldorf Astoria.
1. For text of the Treaty of Commerce between the United States and the Kingdom of Serbia, signed in Belgrade on October 2, 1881, and entered into force on November 15 of that year, see 22 Stat. 963.